ICICI Prudential Mutual Fund is the latest in the series of mutual fund houses to launch an open-ended equity mutual fund scheme. This new scheme offer for ICICI Prudential Housing Opportunities Fund aims to offer long-term capital appreciation by investing in equities or instruments associated with the growth in various housing schemes. Considering the expected boom in the real estate sector, investors may stand to gain a lot from the industry rise. This sector is expected to touch $1 trillion by 2030.
This theme would include various sectors like cement, consumer electronics, housing finance, banks, power, steel, LPG/CNG/PNG/LNG suppliers, etc. The new fund offer (NFO) for this fund will open for subscription from March 28, 2022 to April 11, 2022.
What is this fund about?
The ICICI Prudential MF spokesperson said, “Housing as a theme seems to be poised for a turnaround as the real estate oversupply of 2008-2012 appears to be digested. This may lead to less pressure on real estate prices thereby aiding housing as a theme to perform better.”
Commenting on the launch of NFO, Chintan Haria, Head, Product Development and Strategy, ICICI Prudential AMC said, “Housing as a theme, we believe is at the cusp of a strong cycle. India’s favourable demographics, growing middle-class population, increased urbanization, better affordability and lower home loan interest rates are creating a conducive environment for housing and allied themes,” as reported in the Financial Express.
Speaking on the efforts of the government to improve this sector’s prospects, Haria added, “Moreover, the Government. has been trying to stimulate activity in the sector through various supportive measures like affordable housing, affordable rental housing complex (ARCH) scheme, increase in Capex, stamp duty cuts, 100 per cent FDI for townships and settlements development projects to name a few. India is one of the fastest-growing economies should see strong demand for housing as was seen historically in other developed economies.”
The benchmark index of this scheme would be Nifty Housing TRI.
Will 2022 be defined by NFOs?
Barely three months into 2022, and we have many asset management companies pampering potential investors with NFOs from time to time. For example, the most recent Axis Nifty Midcap 50 Index Fund opened on March 10, 2022 and closed on March 23, 2022. The HSBC CRISIL IBX 50:50 Gilt Plus SDL Apr 2028 Index Fund opened on March 15, 2022, and will end on March 28, 2022. More than 10 NFOs have been announced while there are more in line to be opened for investments. All these funds are either equity or debt while some would invest in exchange-traded funds or invest in overseas Fund of Funds.